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Groundhog Day! Republicans Reprise Bush-Era Proposal To Privatize Medicare And Social Security

Congressional Republicans are standing behind an alternative budget proposal that would eliminate Medicare and privatize Social Security for older Americans - rehashing failed Bush policies that the American people have soundly rejected.

“Some GOP lawmakers also have endorsed Ryan's alternative budget plan, which would wipe out deficits in part by privatizing Social Security and replacing traditional Medicare benefits with an insurance voucher for people age 55 and older.” [Washington Post, 2/2/10]


Ezra Klein of The Washington Post explains the implications that the Medicare provisions in Congressman Paul Ryan's (R-Wis.) budget alternative would have on America's seniors:

“The proposal would shift risk from the federal government to seniors themselves. The money seniors would get to buy their own policies would grow more slowly than their health-care costs, and more slowly than their expected Medicare benefits, which means that they'd need to either cut back on how comprehensive their insurance is or how much health-care they purchase… This proposal would take Medicare from costing an expected 14.3 percent of GDP in 2080 to less than 4 percent. That's trillions of dollars that's not going to health care for seniors. The audacity is breathtaking.” [2/1/10]

From the Congressional Budget Office (CBO) analysis of the Ryan proposal:

“The age of eligibility for Medicare would increase incrementally from 65 (for people born before 1956), as it is under current law, to 69 years and 6 months for people born in 2022 and later. Starting in 2021, new enrollees would no longer receive coverage through the current program but, instead, would be given a voucher with which to purchase private health insurance.” [1/27/10]


Congressman Jeb Hensarling (R-Texas) spoke about the Republican plan to privatize Social Security yesterday on MSNBC's “Hardball”: 

“But [for] those under 55, we have to start a transition to a new system… I`m happy to say that… I`m willing to say that that part of the social contract is going to have to be reengineered We had this debate in Social Security a few years ago. Now, ultimately, we weren`t victorious. There will be a transition. If you want to say that those under 55, as a transition, are they going to get the same deal as their parents? No, probably not.” [MSNBC's Hardball, 2/1/10]

From the CBO analysis of the Ryan budget proposal:

Traditional retirement benefits would be reduced below those scheduled under current law for many workers who are age 55 or younger in 2011…A system of individual accounts would be established in 2012. In that year, workers who are age 55 or younger would be able to participate in voluntary individual accounts, funded with a portion of their payroll taxes.” [1/27/10]

OMB Director Peter Orszag

“[Rep. Paul Ryan's] plan succeeds in addressing our long-term fiscal problem, which is a significant accomplishment.  But let's examine how he does that.  He takes the Medicare program, and for those 55 and below turns it into a voucher program, so that individuals are on their own in the health care market.  And the voucher does not keep pace with health care costs over time… He introduces individual accounts, privatization into Social Security.  He has significant changes to the tax code that would provide large tax benefits to upper-income households, while shifting the burden onto middle and lower-income households.” [2/1/10]